Workplace Wellness Programs: Advantages For Your Company

(Page 2 of 2 of How a Wellness Program Can Help Your Business's Bottom Line)

Now, let's fast forward to the potential results. A good, comprehensive workplace wellness program can, over time, produce the following benefits:

fewer absences

greater on-the-job-productivity

improved worker satisfaction and retention, and

fewer dollars spent on health insurance.

Here's why all four of these benefits are possible, and worth aiming for.

Fewer Absences

The science is clear on one thing: People who are physically healthy miss fewer days of work. With workplace wellness programs, employers have been able to greatly reduce absenteeism. Just getting people to exercise can make a big difference: According to one study, people who regularly get moderate exercise miss 18% fewer workdays, while strenuous exercisers miss 32% fewer workdays.

Of course, if your office policy is to lump sick time and vacation time into general paid time off or "PTO" (as is increasingly common among U.S. employers), you probably won't see a difference. But at least your employees will be having a better time on their days away from the office, and hopefully come back refreshed and ready to work.

Skimping on allotted sick leave isn't the answer. Sure, workers who aren't allowed much sick leave are more likely to show up at work no matter how they feel -- but that just leads to presenteeism (when employees come to work sick but can't function properly) and lower productivity.

Improved On-the-Job Productivity

All the research suggests that employee productivity is where workplace wellness programs yield the greatest returns. This makes sense when you consider that almost every worker, whether or not prone to serious medical conditions, can improve in overall health and fitness to some degree. And with better health comes greater energy and productivity.

Imagine what a functional, maybe even fun, workplace you could have if your employees were more fit and healthy. An Australian study found that healthy workers are 3.1 times more productive than others. Healthy employees not only function better at work, but bounce back faster if they do get sick or injured. You might save yourself having to hire more staff in order to make up for the less healthy and productive ones.

Numbers alone can never tell the whole story. Your employees probably don't work in isolation, but either cooperate as teams, advise each other on work, or hold the classic water-cooler conversations. The value of each worker extends far beyond any immediate day's outcome. An employee with a positive attitude, vital physical state, and optimal physical and mental effort can boost the morale, drive, and productivity of the entire office.

Ask any CEO to name the number one key to business success, and retention of the best employees will come up high, if not tops, on the list. Given the cost of recruiting and training a new employee, the benefits of keeping someone who has years of knowledge and experience may be incalculable. Unfortunately, the very employees you most want to keep will inevitably have the most opportunities to find a job elsewhere -- perhaps one that offers better health benefits or a lower-stress, more functional office environment.

You might feel that your best employees already take good care of their health, without your help. But that would miss part of the point. Will a top employee be happy (to take an extreme example) carrying the extra load for an unhealthy workforce and dealing with the germs, depressed state, or slowness of their less healthy coworkers? Probably not.

On the other side of the coin, workplace wellness programs have been shown to bring employees together in important ways. Your employees are probably already forming office friendships or mutual support networks. It's only a small step for them to start influencing each other's health behavior, perhaps by exercising at the same time or competing toward a goal like regular consumption of five daily servings of fruits and vegetables.

Employees at small or medium-size businesses with wellness programs consistently report that they're working harder, performing better, and are motivated to stay with the company. Managers report that wellness programs improve workplace morale, possibly stemming from the fact that their employees are feeling better all around and sense that their employer is interested in them as individuals.

Reduced Health Insurance Costs

Many employers that have instituted workplace health-promotion and wellness programs have been able to significantly reduce their costs of health insurance as well as workers' compensation insurance, with some studies reporting reductions of up to 30%.

Most experts agree, however, that not every employer should expect to see dramatic results, and that reductions in health care costs shouldn't be your number one motivator for instituting a workplace wellness program. Your health insurance carrier, for example, isn't simply going to say, "Oh, they've started a wellness program, let's lower their rates." The rate-determination process (called "underwriting") involves looking at numerous variables, such as the average age of your workforce and the cost of delivery of health care. Still, in the long run, a healthier group of employees may successfully drive down insurance rates for your business.

Overall Payoff

No matter how much it costs to institute a wellness program, it will be worthwhile if the returns are high enough. Good news: Based on other employers' experience, your chances of coming out ahead look good. Numerous studies have found a positive return on investment (ROI) for employers instituting wellness programs -- anywhere from $1 to $13 gained (in improved productivity and reduced insurance costs) for every $1 spent. The median return is currently said to be $3.14 for every $1 spent. Only a small minority of companies fail to break even -- and that's often because their initial investment of time and money was too low.

Still, some experts caution against over-optimism. They note that you're not likely to see high results within the first year, and that many of the studies were based on large companies or measured results only for participating employees, not for the entire workforce. They also note that certain types of industries get better results than others -- those with high employee turnover, for example, have less of a shot at changing their employee's behavior or of reaping long-term rewards from any changes.

But even if your wellness program merely breaks even -- with a $1 return for each $1 spent -- you'll come out ahead. You'll have offered your employees a workplace benefit that was essentially free. Along the way, you'll probably have boosted morale, reduced the odds of unpleasant interactions between sick or unhappy employees, and given your employees a chance to make changes that will benefit them for their entire life.